The Procurement Experts Talk Facilities Management

Facilities Management is among the most complicated spend categories to assess and source effectively.  Over the last few weeks, Source One's cost reduction specialists Jennifer Ulrich and Nick Harasymczuk have joined the Source One podcast to discuss strategies for approaching the category at various stages.

This time around, they offered up their insights on the topic of implementation.  There's a wealth of technologies available to purchasing groups looking to better manage their facilities.  Additionally, consulting firms can offer expert guidance with or without the support of technology solutions. 

Don't have time to listen? Check out a transcript of the conversation: 

Source One: Hello, and welcome to the Source One podcast.  Consider us your source for the latest Procurement, supply chain, and Strategic Sourcing insights anytime, anywhere.  

Over the last two episodes, we’ve discussed strategies for assessing and optimizing Facilities Management spend.  First, we focused on the critical process of data collection and baselining.  Next, we discussed the ways data helps companies to develop strategies at the RFX stage. 

Today, Nick Harasymczuk Jen Ulrich return for the conclusion of our series. They’ll discuss the process of implementing solutions to ensure long-term success in the Facilities Management category.

Nick, could you start us off by summing up our conversations thus far?

Nick Harasymczuk: Sure. Like we’ve discussed, getting a grasp on the status of your organization prior to engaging in any sourcing event is critical.  That’s how you ensure you’ve got a sound understanding of your company’s priorities, organization, and accountability.  This process is especially important for larger companies with footprints spanning multiple locations and (potentially) multiple countries. Ultimately, you need a plan, and without one you’re setting yourself and your sourcing team up for headaches, inefficient practices, and money left on the table.

Thanks, Nick.  So, what’s the next step in the plan after you’ve conducted a sourcing initiative?   

Jennifer Ulrich: In a sense, the next part of the plan is developing another plan.  You’ve got to determine what course of action you want to implement within your locations.  There are several potential avenues. You might choose to purchase facilities management software applications.  These can help track and monitor your inventory levels, resource allocation, and labor. Or you might to deploying a third party procurement team to help transform your department and prepare it for long term success.

S1: What kind of software options are available to companies?

JU: There are dozens of potential options, but whichever direction you choose it’s important to consider four key categories before selecting any facilities management program:  Essential software, transactional software, functional software, and strategic software.

S1: Could you describe some of the technologies that would fit in the essential and transactional categories?

NH: Essential software is the sort of technology you see at every facility.  These tools are, well essential, to how a facility is managed, monitored, and run.  Whether it is a server that holds contracts, service agreements, employee records, inventory management, or time cards, you absolutely need it to conduct your business’ day-to-day operations. These programs are the backbone of your organization, and without them you’d cease operations.

Transactional software applications are also just what they sound like – simple and straightforward tools.  These applications will help you manage inventory levels, provide a repository for any and all contracts and service agreements, and allow your Procurement team to centralize its information to a single location at a tactical level.

S1: And the other categories include more complicated tools?

JU: Right.  Functional software provides companies with a cost effective resource to manage their business. In additional to tactical organizational value, this software tracks detailed asset and equipment information, manages maintenance costs, streamlines work orders, helps maximize the useful life of assets, reduces space and maintenance costs and much more. This allows managers to manage, and employees to focus on their day to day responsibilities without having to worry about keeping organizational data close by.

Finally, Strategic software is designed to help your organization handle multiple complexities to assist your company and position it for continued growth. While these types of software can provide all the services listed in the transactional and functional categories, they also feature additional capabilities that can grow with your company as you expand and develop your current business. Extended offerings may not be important at first, but it is good to know the service platform you are choosing can grow alongside your business.

S1: Clearly, there are lots of software options available, but could you say a little more about third-party consulting firms?

NH: Certainly.  In a world where everything continues to become automated, there are still other options available to help get your facilities organized and ready for success. Third party consulting firms (such as Source One Management Services, LLC), can work with your current teams to implement sound sourcing processes internally without investing in automation. These firms can also assess your teams and perform unbiased analysis of their strengths, weaknesses, and areas they can improve. Firms offer these services for a predetermined fee, hourly rate, or even a contingency plan based on the amount of spend your facilities generate.  The best will go well beyond facilities management and look for potential cost savings across your entire spend profile.

JU: Remember, successfully sourcing a category is only the beginning.  Determining how you’ll implement organizational and cultural changes across your company is just as important as identifying savings.  Whether you choose a technological solution, a third-party consulting firm, or a combination of the two, it’s the effective utilization of the tools that will make for long-term success.

S1: Thanks Jen, Thanks Nick.  You’ve been listening to the Source One Podcast.  For more information on sourcing across all spend categories, check out our blog The Strategic Sourceror. 

The series is over, but there's always more to learn.  Contact Source One's cost reduction experts today to see first-hand what an optimized Facilities Management category looks like.